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‘Rent by negotiation’

By Amanda Hugankis - 28 June 2010 33

I’m looking for a rental property through allhomes, and I keep coming across this – ‘rent by negotiation’.  Can anyone tell me how this works? 

I know it might sound like its obvious – but I’m wondering if there is more to it?  Is it essentially a rental auction?  Am I missing something?

What’s Your opinion?


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33 Responses to
‘Rent by negotiation’
Clown Killer 10:45 pm 28 Jun 10

It’s the purest way to find the market value, I guess. Of course, it’s not a nice thought for a family to have to drive from property to property getting steadily more desperate, and would mean some people who be taken advantage of for sure

Agreed GG. In reality I suspect that there would be a fairly limited application for this approach. I’m guessing that it would work for ‘trophy’ properties the likes of which are found in Forrest, but probably not for your average suburban three-bedder. For a genuine market price to be set under these circumstances there would have to be a good supply of willing bidders – I suspect many prospective tenants would give rent auctions a wide berth. So then you end up with the same demographics you get a sale auctions – the cashed up and the desperate.

thehutch 10:43 pm 28 Jun 10

nazasaurus said :

“ACT Government is fully aware of the situation and has done nothing”

What do they say when these things are reported?

I’ve experienced a similar situation of reporting a bad pub housing tenant only to be told for ‘confidentiality’ reasons I would not know the outcome. The outcome was that absolutely nothing happened.

It makes you wonder about the mentality of these bureaucrats.. or can someone enlighten me as to what the obstacles are in investigating these people and actually penalising them.

1. No political will;
2. No funding or trained staff to investigate;
3. Difficult to prove in tribunal;
4. The community is more than willing to report alleged fraud, but never actually want to do so on the record or provide formal statements and go to court (why would you want to). It would be great if that didnt need to (why should they need to)… but no legislative powers that makes it easier to prove without this;
5. Ex-partners well renowned for making false allegations – very much a your word against there’s scenario – unless they’re stupid enough to leave a paper trail;
6. No political will.
7. Some (minority) people do get caught.
8. No political will.
9. Most Public Housing tenants do the right thing, the minority give everyone else a bad rep. Sadly this minority has been rorting the entire welfare ‘system’ for a long time and probably will into the future… used to piss me off – now i just realise that i work hard and will end up having a better life than someone who thinks they will get ahead by rorting the system. Karma comes and catches up with you eventually.

troll-sniffer 10:42 pm 28 Jun 10

Can’t see the problem. The agent and or owner aren’t sure of what the current rental that the property is capable of achieving and are inviting prospective tenants to make an offer. By negotiation does not necessarily mean to the highest bidder I imagine (unless the owner is a fool). A prospective tenant with gold references ready to move in immediately for a long term lease could possibly offer $20.00 per week less than a couple of tradies who roilly roilly need the place and still get the lease.

So unless the term ‘by negotiation’ is code for a rent auction I can’t see any problem with the concept.

Amanda Hugankis 9:06 pm 28 Jun 10

Okay so it seems as obvious as I thought – it’s essentailly a silent auction – chuck ur bid in and if ur the highest bidder … you win! The place I’m currently interested in is a basic apartment, so not much I can negotiate in exchange for rent unless I go with Sexynotsmart’s sugesstion of offering up goods of an intimate nature. Maybe I can offer to cook the landlord dinner every second Tuesday, or maybe name my first born after them. Or maybe leave the agent and their landlord to fleece someone else.

georgesgenitals 8:39 pm 28 Jun 10

Clown Killer said :

The rent auctions are a different creature altogether. The model proposed by some Canberra property managers was essentially based on the property sale model – a crowd of prospective tenants would gather on the front lawn of some freshly spruced up property and the auctioneer would go to work … “Will someone give me $350 a week? … thank you … $350 a week, $360 up the back. $360 a week … it’s against you sir. $370. Thank you …” and on it would go until the market price was found.

It’s the purest way to find the market value, I guess. Of course, it’s not a nice thought for a family to have to drive from property to property getting steadily more desperate, and would mean some people who be taken advantage of for sure.

moneypenny2612 8:37 pm 28 Jun 10

According to both the Office of Regulatory Services (which monitors fair trading in the ACT) and the Tenants Union:

Residential properties ought to be advertised for rent at a fixed price (advertising includes verbal representations as well as written ones). If a property is advertised without a price, with prospective tenants asked to nominate a price, then this is rent bidding.

If landlords or real estate agents encourage rent bidding or auctions this could be a breach of the Trade Practices Act (depending on how it is conducted). In the case of agents, such conduct could breach their Code of Practice. This practice should be reported to the Office of Regulatory Services, or the Tenants Union.

In relation to the conduct of agents, the ORS has advised the RE industry that “… the agent must follow certain procedures to ensure they do not breach the Agents Act 2003 or any other legislation.”

For more specific info, see: http://www.ors.act.gov.au/ors/pdfs/Newsletters/ORS_E-News_07-April.pdf

Rent auctions (I’m looking at you Peter Blackshaw RE) are currently unregulated in the ACT. The current formal rules for auctions only apply to sales. This leaves prospective tenants rather exposed with no transparent or accountable process and potentially unethical conduct by auctioneers and landlords.

Be vigilant tenants. Don’t be sucked in by the hype. Although some rents may genuinely be open to negotiation, if you that the negotiating is a sham – report it.

Clown Killer 7:54 pm 28 Jun 10

I would imagine that most decent property managers (if that’s not a tautology) would know the market well enough to be able to set rent. There would be the odd property with little or nothing to compare it with that might make placing it in the market difficult. I don’t see that there’s too much of a problem with negotiating a rent with a landlord – it’s pretty common in the commercial property market. As a prospective tenant you’d have to have a fair idea of what you can afford and what that will get you in the market … if the place looks way better than anything you’ve seen elsewhere in your price range then chances are it’s not in your price range … easy.

The rent auctions are a different creature altogether. The model proposed by some Canberra property managers was essentially based on the property sale model – a crowd of prospective tenants would gather on the front lawn of some freshly spruced up property and the auctioneer would go to work … “Will someone give me $350 a week? … thank you … $350 a week, $360 up the back. $360 a week … it’s against you sir. $370. Thank you …” and on it would go until the market price was found.

sexynotsmart 7:23 pm 28 Jun 10

I thought it meant in exchange for services of an intimate nature. But hey, I guess it could mean the rate is negotiable.

nazasaurus 6:43 pm 28 Jun 10

“ACT Government is fully aware of the situation and has done nothing”

What do they say when these things are reported?

I’ve experienced a similar situation of reporting a bad pub housing tenant only to be told for ‘confidentiality’ reasons I would not know the outcome. The outcome was that absolutely nothing happened.

It makes you wonder about the mentality of these bureaucrats.. or can someone enlighten me as to what the obstacles are in investigating these people and actually penalising them.

I-filed 5:48 pm 28 Jun 10

It’s just part of the ACT Government’s systemic dysfunction around all aspects of houseing. e.g. Three adults from the same extended family (former partners and a sibling of one of them) are still occupying three houses, once each, 9 bedrooms, $1,800,000 worth of ACT Housing property in the inner suburbs … actually, one of them has lived interstate for the last three years and has been subletting illegally for that entire time. All are paying welfare rent rates (even though one of the three works fulltime and manages to continue to pay welfare rates by taking a week off work every six months when they have to fill in the form). Children all left home by two years ago. ACT Government is fully aware of the situation and has done nothing. These tenants graciously condescended to give up a two-bedroom flat they were illegally subletting, a hangover from a brief period when one of the aforementioned children decided they needed their own pad.

The Frots 5:35 pm 28 Jun 10

It is illegal in most states – but not here!!!! Strange isn’t it. Perhaps our leader would be kind enough to take a few boarders. After the next election, he may need the extra income.

stereo henry 5:16 pm 28 Jun 10

Pretty sure that in every other state and territory this kind of activity is illegal. This is just another way the ACT fails to provide any protections for tenants and always favours the landlord.

Interesting that our dear leader, overlord-and-mayor-of-struggletown-prand-poo-bah Stanhope, wants 500,000 residents in the ACT – if they can’t afford to buy or rent where will they live?

Erg0 5:10 pm 28 Jun 10

I seem to recall that it was reported during the last rent panic that rental auctions were illegal, or at least in contravention of some rule or other. I could be wrong, though.

The Frots 4:53 pm 28 Jun 10

I have found that it can mean a lot of things. You may negotiate for a lower price on the rent in exchange for upkeep, or it may be that the rent is so incredibly high that they can’t fit the figures on the page.

merlin bodega 4:49 pm 28 Jun 10

Easy. You just tell the landlord how much you earn each week and the real estate agent adds $10 to that.

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